Starbucks Sees Higher Costs: Fool by Numbers

• Email
• Share
• Print

On Jan. 31, ubiquitous coffee purveyor Starbucks (Nasdaq: SBUX) released first-quarter earnings for the period ended Dec. 31.

• Company-operated retail revenues rose 23% to $2.3 billion, primarily because of the opening of 1,177 new stores in the past 12 months.
• Comparable-store sales also grew 6% during the quarter.
• Net profit increased by 17.7% because of higher sales, which were partially offset by rising operating expenses.

(Figures in millions, except per-share data)

Income Statement Highlights

	Q1 2007	Q1 2006	Change
Sales	$2,355.7	$1,934.1	21.8%
Net Profit	$205.0	$174.2	17.7%
EPS	$0.26	$0.22	18.2%
Diluted Shares	782.8	792.9	(1.3%)

Get back to basics with a look at the income statement.

Margin Checkup

	Q1 2007	Q1 2006	Change*
Gross Margin	58.2%	59.8%	(1.6)
Operating Margin	13.6%	14.5%	(0.9)
Net Margin	8.7%	9.0%	(0.3)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets	Q1 2007	Q1 2006	Change
Cash + ST Invest.	$436.5	$538.5	(19.0%)
Accounts Rec.	$227.8	$197.8	15.2%
Inventory	$547.3	$452.7	20.9%

Liabilities	Q1 2007	Q1 2006	Change
Accounts Payable	$275.7	$208.6	32.2%
Long-Term Debt	$1.7	$2.7	(34.9%)

Learn the ways of the balance sheet.

Cash Flow Highlights

	YTD 2007	YTD 2006	Change
Cash From Ops.	$569.1	$608.9	(6.5%)
Capital Expenditures	$161.3	$147.3	9.5%
Free Cash Flow	$407.9	$461.5	(11.6%)

Find out why Fools always follow the money.

Related Companies:

• Caribou Coffee (Nasdaq: CBOU)
• Diedrich Coffee (Nasdaq: DDRX)
• Green Mountain Coffee (Nasdaq: GMCR)
• Peet's Coffee (Nasdaq: PEET)
• Tim Hortons (NYSE: THI)

Related Foolishness:

• What's Missing at Starbucks?
• Starbucks' Gift Cards Keep Giving
• Interesting Times at Starbucks

Starbucks is a Motley Fool Stock Advisor selection. To find out how it's helping the newsletter outperform the market, you can take a 30-day free trial.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.